Klugman, Jeni2014-08-202014-08-202007-12https://hdl.handle.net/10986/19539This study sheds some light on the challenges facing policy makers in Ethiopia, but much remains to be better understood. Over the past three years, food price inflation in Ethiopia has been persistently high, and overall inflation has been in double. While the spike in 2002 can be broadly explained by the drought-induced output shock that year, over the period as a whole, food price - and in particular grain price - trends present a puzzle in several respects. This is a serious concern for policy-makers, not least because the poor spend most of their income on food, and are adversely affected by rising prices. Even in rural areas, it is estimated that about half the population are net buyers of food. The issue of food price inflation has attracted rising concern in the national media and among policy makers, academics and of course the public at large, as well as among development partners. The structure of this note is as: authors review the key features of Ethiopian grain markets, before laying out a basic methodological approach to analyze the drivers of inflation, followed by a review of the relative importance of different explanatory factors on the demand, supply and marketing sides. Authors then turn to explore the impacts of food price changes on households, drawing on the most recent household data available. The final section highlights emerging policy conclusions.en-USCC BY 3.0 IGOADVERSE IMPACTSAGGREGATE DEMANDAGGREGATE SUPPLYAGRICULTURAL COMMODITYAGRICULTURAL DEVELOPMENTAGRICULTURAL EXPORTSAGRICULTURAL GOODSAGRICULTURAL MARKETAGRICULTURAL MARKETINGAGRICULTURAL MARKETSAGRICULTURAL OUTPUTAGRICULTURAL PRICESAGRICULTURAL PRODUCTAGRICULTURAL PRODUCTIONAGRICULTURAL PRODUCTION SYSTEMSAGRICULTURAL PRODUCTIVITYAGRICULTURAL PRODUCTSAGRICULTURAL SECTORSAGRICULTURAL VALUEAGRICULTUREAGRICULTURE MARKETSAGRICULTURE ORGANIZATIONAUCTIONAVERAGE PRICEBAKINGBASE YEARBENCHMARKBORDER PRICESCAPACITY BUILDINGCENTRAL BANKCENTRAL BANKSCEREAL PRICESCEREAL PRODUCTIONCEREAL YIELDCEREALSCOMBINESCOMMERCIALIZATIONCOMMODITIESCOMMODITY EXCHANGECOMMODITY PRICECOMMODITY PRICESCONSUMER PRICECONSUMER PRICE INDEXCONSUMERSCOST OF LIVINGCROP PRODUCTIONCROP ROTATIONCUTTINGDEBTDEMAND FOR FOODDEMAND MANAGEMENTDIVIDENDSDOMESTIC PRODUCERSECONOMETRIC ANALYSISECONOMIC TRENDSEDIBLE OILSELASTICITYELASTICITY OF DEMANDEXCESS DEMANDEXPENDITUREEXPENDITURESEXPORTEXPORT TRADEFARMFARM EMPLOYMENTFARM INCOMEFARM INPUTSFARMERSFINANCIAL INSTRUMENTSFINANCIAL MARKETFINANCIAL MARKETSFINANCIAL SECTORFOOD AIDFOOD AVAILABILITYFOOD CROPSFOOD DEMANDFOOD EXPENDITURESFOOD IMPORTSFOOD MARKETSFOOD POLICYFOOD POLICY RESEARCHFOOD PRICE INFLATIONFOOD PRICESFOOD PRODUCTIONFOOD SECURITYFOOD SUPPLYFOOD TRANSFERSFOODSFOREIGN EXCHANGEFRUITSGDPGLUTENGRAINGRAIN PRICESGRAIN PRODUCTIONGRAIN TRADERGRAIN TRADERSGRAINSGROSS DOMESTIC PRODUCTGROWTH RATEHOUSEHOLDSHUMAN CAPITALIFPRIIMPORT TARIFFSINCOMEINCOME EFFECTSINCOME ELASTICITY OF DEMANDINFLATION RATEINPUT PRICESINTEREST RATESINTERNATIONAL FOOD POLICY RESEARCH INSTITUTEINTERNATIONAL MARKETINTERNATIONAL MARKETSINTERNATIONAL TRADELIQUIDITYLIVE ANIMALSLIVESTOCKLIVESTOCK PRODUCTSLIVESTOCK SECTORM2MAIZEMARKET INFORMATIONMARKET INTEGRATIONMARKET PRICEMARKET PRICESMARKET SHAREMARKET SUPPLYMARKETINGMEATMERCHANDISEMERCHANDISE EXPORTSMIDDLEMENMILLSMOBILIZATIONMONETARY POLICYMONEY SUPPLYPARITY PRICEPEPPERPER CAPITA INCOMEPER CAPITA INCOMESPOTATOPRICE ADJUSTMENTPRICE ADJUSTMENTSPRICE CEILINGPRICE CHANGEPRICE CHANGESPRICE DECLINESPRICE DETERMINATIONPRICE EFFECTPRICE FORECASTSPRICE INCREASEPRICE INCREASESPRICE INFLATIONPRICE LEVELPRICE LEVELSPRICE MOVEMENTSPRICE TRENDPRICE TRENDSPRIVATE STORAGEPRODUCT MARKETPRODUCTION COSTSPRODUCTION INCREASESPRODUCTIVITYPULSESPURCHASINGPURCHASING POWERREAL GDPREAL INTEREST RATERURAL AREASSALESSTOCKSSTORAGE CAPACITYSTRUCTURAL CHANGESUBSISTENCE AGRICULTURESUBSTITUTIONSUGARSUPPLY INCREASESUPPLY INCREASESSURPLUSSURPLUSEST-BILLSTRADE FLOWSTRANSACTIONTRANSACTIONS COSTSTRANSACTIONS DEMAND FOR MONEYTREASURY BILLSVALUE ADDEDVOLATILITYWAREHOUSEWEALTHWFPWHEATWHOLESALE PRICEWHOLESALE PRICESWORLD FOOD PROGRAM10.1596/19539